Automotive industry as a pioneer for procurement.

The procurement organizations in the automotive industry are seens as some of the best in the world. For car manufacturers and suppliers, procurement is a core function, closely integrated with innovation management and production. However, in view of the change to zero-emission mobility, new skills and cooperation are required.

It is not only important to develop strategies for electromobility together with existing suppliers, but also to approach new partners for innovative mobility services. To realize the mobility turnaround with competitive cost structures, our automotive experts assist you with tailored automotive consultancy.

Alternative engines

After years of tightening emisson regulations, the European Union has decided to phase out combustion engines for passenger cars from 2035. For OEMs and suppliers, this means that the transition to carbon-neutral powertrains must happen faster than some had originally planned. Additionally, it is no longer possinle to cross-finance research and development in the near future using revenue from thesale of diesel and gasoline-powered automobiles.

Suppliers with a focus on traditional powertrains must accelerate their transition to new business areas.

Decarbonization

The EU’s requirements do not stop at emission-free propulsion: in future, cars should not only drive CO2-free, but also be produced without emissions. The automotive sector is no stranger to fast innovation cycles, intense cost pressure, and tight supply chain integration across the globe. Because of this, it appears that the automotive industry and its suppliers are more prepared than other sectors for the new challenge of decarbonization. However, in order to create emission-free vehicles in a carbon-neutral manner and at the same time to make them profitable, large sums will need to be invested within a short period of time.

The Coronavirus pandemic and its impact on supply chains have also demonstrated that even OEMs, which – compared to other industries – have a relatively high level of supply chain transparency and established risk management processes, still need to make their supply chains more resilient. Forecasting and risk management need to be further optimized.

Lack of raw materials

The transition to e-mobility has greatly increased the complexity of obtaining raw materialsDue to the circumstances in which they are mined and produced, raw materials for electric, such as nickel, cobalt, and rare earths, have been challenging to obtain in a suitable way. However, more and more consumers are now placing demands on businesses to uphold social and environmental standards across their supply chains.

In addition, many of the materials are subject to strong price fluctuations.

The combination of sustainability and cost-efficiency criteria poses a special challenge for the procurement of critical raw materials. Our experts support you in mastering this challenge.

The semiconductor crisis has shown with unprecedented clarity that automotive manufacturers and suppliers are not only competing for resources within the industry, but also have to face competition across industries. This is especially true for the consumer electronics sector, where a few large players with high innovation speed dominate the market. Here it is important to guarantee supply security at all times through precise forecasting and stable partnerships.

Price, availability and lead time – this is the field of tension in which consumer goods producers have always operated. In addition, more and more consumers want sustainably manufactured products. Suppliers with a clear sustainability profile can use competitive advantages here.

Consulting for procurement & SCM in the consumer goods industry

High speed and great variety are the characteristics in which the consumer goods industry clearly differs from other industries. Consumers want novelties: Products for daily use should be original, beautiful or useful – and increasingly also sustainably produced. More and more companies understand this. They are looking at ESG criteria, setting goals and developing roadmaps towards becoming an environmentally friendly and carbon-neutral company.

Our experts for the consumer goods industry accompany you on this path – and support you in procurement to optimise price, availability and lead time also with regards to sustainability goals.

The consumer goods industries are as diverse as the consumer needs of the citizens. Even if the products are very heterogeneous and have very different significance for the everyday lives of consumers, all suppliers are faced with the task of switching to sustainability at reasonable prices and remaining innovative in the process.

Which topics are important in the consumer goods industry?

Ahead of the competition with efficient processes

Clear structures and efficient processes within your company are the basis for developing innovative products and bringing them to market quickly. We analyse your internal processes and identify potential for optimisation.

We see procurement as a value-added partner for development and production. The earlier procurement is involved in planning, the better they understand what is important and can sound out the market. In this way, ideas move more quickly from conception to production.

Our experts have extensive experience in many areas of the consumer goods industry. Thanks to our extensive knowledge of consulting private label producers, we are able to significantly reduce procurement costs for all direct and indirect requirements.

Professional raw material management

For many consumer goods manufacturers, the procurement of raw materials accounts for a significant share of the total purchasing volume. The relevance of raw material prices for business success is correspondingly high. It is true that procurement cannot completely escape the respective market development. Nevertheless, there are strategies to determine the appropriate time to buy or to hedge against massive price increases.

Pick up speed - reduce lead times

Early involvement of procurement in planning is also an important prerequisite for reducing lead times. To enable acceleration, we analyse all steps from the idea to the delivery of the finished product to the warehouse and identify approaches for optimisation. Together with your team, we implement the solutions and train the new procedures.

Know and understand the supply chain

The Corona virus pandemic has shown: Few companies have truly deep insights into their supply chain. However this knowledge is now becoming more important – to identify supply risks in terms of security of supply, and to perceive sustainability risks and counter them effectively. The consumer goods industry in particular is in the spotlight here, as consumers come into contact with their products on a daily basis. In addition, the Supply Chain Act requires that human rights and environmental standards be enforced in supply chains in the future.

Sustainabilty starts with packaging

However, ESG criteria do not only apply to the product, but also to the packaging. Of course, packaging should first and foremost protect the contents. To do this, it needs specific properties depending on the product, such as a barrier function for liquids or air.

Fully sustainable packaging materials that meet all these criteria do not yet exist. But as our study on sustainable packaging shows, manufacturers are aware of this challenge and are researching viable solutions.

Together with your procurement, we analyse the options available, sound out the market for your specific needs and develop contemporary solutions.

Digital Solutions

Intelligently deployed digital tools relieve your procurement of routine activities, analyze processes and monitor the supply chain. We examine the degree of digitization in your company, compare it with benchmarks, and create a roadmap for you that starts where benefits and investment are in the best relationship.

Banks and insurance companies are under pressure to innovate – professional procurement is not only an expert in demand management in indirect spend, but can also make a decisive contribution to new developments and digitalisation projects.

Efficient procurement optimisation in the financial sector

Hardly any other industry is as affected by digital upheaval as the financial sector – new players are constantly entering the market and fintechs are serious competitors. Keeping up with technological innovations and helping to shape the future of the industry is the biggest challenge for most banks and insurance companies.

Through procurement optimisation, financial service providers can not only achieve significant savings that have a direct impact on success and liquidity, professional procurement is also an important savings partner in the development and implementation of future strategies and trends, such as in the area of digitalisation.

Procurement optimisation for regional and international banks and insurance companies

As a specialised procurement consultancy, we advise both regionally based banks and insurance companies as well as internationally positioned groups and banking institutions on optimising procurement costs and meeting demand. Thanks to our many years of experience, we know the challenges in the financial services sector.

We have therefore developed sector-specific organisational concepts, commodity group strategies and procurement levers with which we can achieve significant and sustainable successes that have a noticeable impact on our clients’ overall results.

How do we proceed when counseling financial service providers?

Unlocking potential in Indirect Spend

The product groups relevant for financial service providers can basically be classified into three categories: IT & telecommunications, services and general administration & facility management. Since these commodity groups are not part of the value added, they are often also listed under the term “Indirect Spend”. Specifically, these are external expenses for IT programming, hardware and software, marketing, information services and facility management, among others.

IT & Telecommunications

Marketing Procurement

Facility Management

Implementation of the potentials in the company

In addition to developing concepts, we also act as an implementation partner: once potential savings have been identified in the commodity groups, we support you in implementing them and, if necessary, in switching to new suppliers. To ensure sustainability, we establish new processes on request and ensure that contracts with suppliers deliver the savings achieved and the required quality standards. Our results will be visible in your liquidity, which is why we also let ourselves be measured by the success of our work when setting our fees.

Process analysis and development

Demand consolidation in the context of large and highly distributed branch networks is often a particularly great challenge for the procurement of banks and insurance companies. We analyse your processes and communication channels, develop new, efficient procurement processes together with you and establish them in the company with your specialist departments. To practice and consolidate processes, we conduct workshops and process simulations with all employees involved in your branch network. For the corresponding digitalisation and anchoring of the new procurement processes in your overall organisation, we look for suitable IT service providers for you or accompany you during the software implementation in the existing system.

Digitalisation and technological innovations

The financial industry is developing rapidly. Fintech companies have long been among the major players in the market – and they are constantly changing the market with new technological innovations. Keeping up with these developments and driving new developments themselves is a major challenge for many banks and insurance companies. We support you with our expertise in the digitalisation of your services and help to drive digital innovations in your company.

Professional training for procurement staff

The procurement function is subject to constant change and with it the requirements for procurement staff. We help you to train your own employees for the newly required qualifications. Our services range from the analysis of qualification needs to interactive training in face-to-face or web-based events. Training programmes are customised for your employees and tailored to your company. Our trainers are experienced procurement experts know the financial sector and its specifics well.

Strongly fluctuating order volumes, decreasing internal value creation depth, increasing competitive pressure and more complex interlocking of value creation structures put pressure on machine and plant manufacturers. With these demands, the importance of procurement has also grown steadily in recent years.

Volatile initial situation and increasing competitive pressure

Machine and plant manufacturers are currently facing a number of challenges that are crucial for their profitability. Currently, they have to cope above all with strongly fluctuating order volumes; batch sizes are also becoming smaller and the processes are thus becoming considerably more complex. This complexity is further increased by the decreasing internal vertical range of manufacture and a more complex interlocking of the value-added structures.

Competition and cost pressures have also risen continuously in recent years, not least due to strong competition from companies in Asian countries, which now act as strong rivals in the field of innovation. Added to this are rising raw material prices and tight markets on the supplier side.

Develop your procurement into a value driver

Companies from the mechanical and plant engineering sector live above all from their technical innovations and solutions. Therefore, engineering naturally has a high priority in the company. This is especially true for traditional, medium-sized companies. An efficient procurement organisation can also make a significant contribution to the company’s success and increase its overall resilience.

With our comprehensive industry expertise, we support your procurement to position itself as a value driver. In our projects, we work cross-functionally and use many technical approaches in addition to commercial levers for optimisation. In addition, we support you in the area of Indirect Spend, an area that experience shows is often neglected.

Our machinery and engineering services

Commercial Levers

Within the framework of comprehensive cost optimisation programmes, we analyse potentials in your direct spend and support you with new tenders, global sourcing projects, supplier negotiations or auctions. In raw materials procurement, we define optimal buying times with you and negotiate conditions with the help of recognised indices.

Technical Levers

Particularly in mechanical and plant engineering, we can tap into considerable value-added potential through technical levers. We carry out comprehensive analyses, such as target costing, linear performance pricing or design-to-cost considerations, and use them to optimise your cost structures. We also support you with redesign, harmonisation or standardisation projects.

Indirect Spend Management

In the area of Indirect Spend, we help you implement an optimal operating model, define governance processes and derive and implement commodity group strategies. For this purpose, we use professional methods such as demand management and tail-end management.

Make-or-Buy / Outsourcing

We conduct make-or-buy analyses for you and use our extensive benchmark database for this purpose. In the case of outsourcing, we use our know-how of the supplier markets to find the optimal partner for you, and support the entire process from the initiation to the signing of the contract.

Digitalization

We support you in the digital analysis of your costs, the conversion to e-sourcing and the digitalisation of processes. In doing so, we identify the optimal tools for you and accompany the implementation process in your company. In addition to classic purchasing tools, we also provide cross-functional support with interfaces to engineering through the introduction of tools for the use of technical levers.

Risk- and supplier management

We help you to set up or further develop a professional risk management system and support you in evaluating your suppliers. In addition, we work with you to build a sustainable supplier management system so that you can ensure more stable supply chains in the future and also benefit from partnerships in the areas of innovation and working capital.

Working Capital Management

We analyse your payment terms and inventory turnover and identify potential for optimising your working capital. In this way, we create the flexibility you need to survive in volatile markets.

The requirements for logistics and infrastructure companies are extremely complex – a multitude of partners must be coordinated for an optimal process flow. To optimally control these and to network them in a digitally meaningful way is a mammoth task in which procurement plays a leading role.

Shaping the future of mobility and logistics

Previously, globalisation and growing prosperity ensured a positive development in the movement of people and goods worldwide. The mobility and logistics sector is also in the spotlight in the effort to shape a more sustainable and climate-friendly future. However, the COVID-19 pandemic has disrupted global supply chains in many places. Here, logistics companies in particular are in demand; they must expand their partner network and efficiently design and digitalise processes due to the good order situation and the endeavour to guarantee ever shorter and precise delivery times that can be tracked down to the last mile.

In passenger transport (long-distance and local transport, as well as air transport and related infrastructure), many companies massively reduced their capacities during the Corona crisis and are now in the process of managing the restart reliably, quickly and cost-efficiently. In all cases, professional procurement processes and unlocking potential are essential to ensure resilience and sustainability of supply chains and create space for innovation and investment in the future.

Increasing profitability in logistics and mobility companies

The procurement needs of logistics and mobility companies are characterised by a high proportion of investments in infrastructure, vehicles and the procurement of operating resources and services. The industry is no longer limited to the pure transport of people or goods. Today, the airline offers all services related to travelling, the transport company takes care of the entire flow of goods from production to ordering to payment by the customer.

As a consequence, the procurement of services and service partners, optimally networked on the IT side, plays a far greater role than in other industries. The corresponding requirements are increasing and becoming much more complex. We support you in identifying potentials and achieving sustainable optimisations. In addition, we support you in setting up your procurement for the future – through suitable organisational structures, buyer roles and efficient, digitalised processes.

In which areas can we support logistics companies?

Operations Management

We analyse your end-to-end processes, including all warehouses and operating locations, and identify suitable levers to increase process stability and reduce process cycle times. In addition, we have benchmarks for your SG&A functions and conduct a pragmatic assessment with a focus on personnel cost reduction and optimisation of the functional operating model (efficiency & effectiveness).

Procurement Transformation

We support you in optimising your organisational structures, help you to optimally allocate capacities and define roles in procurement. We ensure through accompanying change management and training programmes that the change processes are also anchored in your employees’ minds.

Cost Optimization & Demand Management

Using a spend cube, we analyse your cost structures and identify potential savings in all service areas by comparing them with benchmarks. Further, we define the actual requirements with you, review your service level agreements and talk to your partners to optimise the price structures and your partner network.

Digitalization

With the help of advanced analytics, we analyse your buying volume and identify savings potential in all areas by comparing it with benchmarks. We have benchmarks for standard market service requirements, e.g. in the product groups IT, contracts for work and services and facility management. In “Challenger Workshops” together with procurement and relevant demand drivers, we define the actual demand required, review your service level agreements and talk to suppliers to optimise pricing structures and your partner network. With this demand-driven approach, cost optimisation > 25% is often possible.

Risk Management and Sustainabilty

Together with you, we create a target picture for risk management and agree on risk criteria and levers. In doing so, we analyse your procurement and your partner network. Also with regards to the ESG criteria and requirements of the Supply Chain Act, we recommend adjustments in your procurement processes and derive concrete preventive and remedial measures.

Supplier Management

We work with you to develop a supplier management process and put together a suitable toolbox for procurement. We support them in identifying new, cost-efficient, innovative suppliers and further develop existing supplier relationships.

The process industry is facing a profound change due to the switch to sustainable energies. As the production and refinement of crude oil are gradually phased out, companies must analyse their value chains and develop alternative scenarios. Procurement plays a central role in this.

Consulting for procurement & SCM in process industries

The switch to environmentally and climate-friendly technologies challenges the process industries from two sides: Firstly, the high energy demand must be covered from regenerative sources in the future; secondly, alternatives for petroleum based reactants must be found. At the same time, companies from the process industries can contribute with research and innovations to contribute to the creation of a CO2-neutral economy. With experience from numerous projects, our experts support you in preparing procurement and the supply chain for the challenges and developing them into strong partners for future value creation.

How do we proceed within the process industry?

Triad of cost optimisation, resilience and ESG

The time when procurement managers from companies in the process industries could focus solely on price is over, at the latest since the Corona virus pandemic. The massive disruptions in supply chains and the growing awareness of the consequences of climate change have turned harmony into a triad: Procurement departments are not only responsible for negotiating a good price, but also have to ensure a stable supply and consider sustainability criteria when selecting suppliers.Germany and some other countries already have a supply chain law for this; the European Union is planning its own law that may go beyond what national governments require of their companies. 

Creating transparency in the value chain

In order to fulfil all three tasks in the best possible way, procurement managers first need transparency in the value chain.

• How prices are made up and what share raw material prices in particular have in total costs.
• What their supply chain is like and who their suppliers are.
• Where risks lurk in relation to ESG (Environment, Social, Governance) criteria.

This is where digital tools can provide valuable information. What influence the switch to renewable energies and the associated move away from fossil fuels has on their own value chain. Solutions should be found together with the partners in the supply chain and, if necessary, new procurement markets opened up and new cooperations initiated.We would be happy to work with you to develop adequate risk management and define action plans for price, supply and compliance risks. We support the development of a CO2-neutral business model and work with you to design the path to decarbonisation.

Tapping alternative energy sources

With today’s capacities, the process industries’ great requirement for energy cannot be met from renewable energy sources, that is obvious. Nevertheless, the political course has been set and major investments can be expected in the coming years. In view of the lack of solar and wind energy, many companies are financing their own plants for environmentally friendly power generation. In these cases, procurement needs to be competent in CAPEX requirements. This is not only about the procurement of a group of goods, but also about project management and total cost of ownership analyses. We provide support both directly in the project and with individually tailored further training in procurement.

Intelligent product group management

In our experience, buyers in the process industry are excellently trained and experienced in meeting the high demands – such as legal requirements and safety regulations – of their core products. However, in many companies these demanding rules often also apply to less critical products. This complicates and increases the cost of procurement processes, and efficiency suffers. An intelligently designed product group management defines which precautions and rules apply depending on the importance of the materials. This noticeably relieves your procurement and increases efficiency for low-risk and small-scale commodity groups.

The efficiency of the health care system is measured by its ability to cure more and more ailments. At the same time, risks are to be minimised and, despite an ageing society, the total expenditure for the system is not to grow unchecked. Procurement and supply chain management are the key to success.

Procurement & SCM for pharmaceuticals, medical technology & service providers

The entire healthcare sector has been struggling for years with increasingly complex regulations on the one hand and massive cost pressure on the other. The opportunity to break out of this squeeze lies in the professionalisation of procurement and supply chain management. This applies equally to healthcare providers, pharmaceutical companies and medical technology manufacturers, even if the challenges in the three pillars of the healthcare industry are different. Our healthcare experts advise and support you in setting up procurement and SCM optimally for your individual needs.

The energy industry is undergoing a transformation. Sustainability and green energy are playing an increasingly important role. On the way to a climate-optimised energy economy, different subjects are in the focus for different sectors.

Procurement excellence for the energy sector

The energy industry is undergoing unprecedented change. The aim is to produce completely carbon-neutral energy by 2050 – as envisaged in the European Union’s Green Deal – while keeping energy costs at a competitive level that is also acceptable to end consumers.

Whether it is hydrogen, synthetic fuels or the use of renewable energies: energy companies that want to develop further need professional procurement functions in order to achieve innovation and cost excellence, ensure security of supply and establish new procurement and supply structures.

On the journey to a climate-optimized energy industry, different sectors are faced with different issues. Thanks to our many years of experience, we know the specific issues and can competently support clients from all sectors in their transformation. As procurement and supply chain management experts, we always keep an eye on reducing the cost of energy. 

• renewable energies
• oil and gas industry
• energy suppliers
• energy specific technologies

Climate-friendly transformation

On the wayto a climate-optimized energy economy, different sectors are faced with different issues. Thanks to our many years of experience, we know the specific problems and can competently support clients from all sectors in their transformation. As experts in procurement and supply chain management, we always keep an eye on reducing the cost of energy.

Our services in the energy sector

CO2-neutral energy production

The complete shift to energy sources without a carbon footprint requires huge investments. The International Energy Agency (IEA) has calculated that energy companies will need to invest four trillion dollars globally by 2030 to achieve full decarbonization by 2050.

In order to build new plants at competitive energy production costs, early involvement of procurement in the planning process is necessary, and cross-functional cooperation between procurement and engineering is vital. This is particularly true because procurement inevitably cannot fall back on established suppliers when switching to new concepts. The earlier procurement is involved in the planning, the more time it has to find innovative suppliers for new tasks. Partnerships offer a real opportunity to benefit from the knowledge of specialists and to develop solutions together.

Our energy sector experts are happy to support you in the conception and implementation of optimal sourcing strategies. In this way, we ensure efficient cost management for our clients. This also applies to the indirect requirements of fast-growing and increasingly international companies.

Oil and gas

Companies in the oil and gas sectors are adapting business models and cost structures to changing demand. At the same time, the development of new, sustainable business models is leading to new procurement challenges for companies in the industry.

Examples are

• Investments in renewable energies
• Integration of charging stations into petrol station networks
• Research into synthetic fuels or biofuels

In companies from the gas and oil industry, procurement is the area where significant savings potential can be addressed in order to realize competitive energy production costs. At the same time, as a link to the supply chain, the department plays a central role in achieving sustainability goals and establishing innovative processes.

The prospect of declining revenues for fossil fuels requires active cost management within the framework of traditional business models. In maintenance, cost optimization is becoming increasingly important – plants and infrastructure have to work efficiently and safely.

Energy infrastructure

Private power generation via photovoltaics plays a decisive role in many political plans to achieve carbon neutrality. In order to do so, infrastructure must be adapted at the same time. More and more private households are becoming not only consumers, but also producers and suppliers. Transmission system operators are thus challenged to plan and implement large-scale projects to manage decentralized infrastructure, which is not possible without external service providers. The goal is to find practicable and affordable energy technology solutions.

Parallel to the real estate sector, the automotive sector is also switching to electricity instead of fossil energy. The development of the charging infrastructure therefore requires further investments and an intelligent connection to the supply networks.

Procurement is required for all of these tasks. It is foreseeable that in the course of this development, procurement will play a much more prominent role than in the past. In order for your procurement team to be able to meet the increased challenges, you should invest specifically in the training of your buyers. We would be happy to draw up an individual plan together with you.

Digitization

In the evolution of the energy sector, digitalization is the key to success and requires innovative supplier and procurement management, e.g. 

• the control of a decentralized energy network by means of smart metering
• cost optimization in maintenance and repairs through innovative technologies, such as remote diagnostics, remote monitoring or predictive maintenance
• the acceleration of internal company processes from the conclusion of a contract to payment
• innovative spend analytics solutions

You can find out more about our expertise in the digitalization of procurement here.

Our experts would be happy to support your team on the way to a CO2-free future.

Financial cushions and low interest rates create optimal conditions for investment. However, the high sales prices force private equity companies to maximise value creation in the company. In order to secure the margin, the procurement of portfolio companies must use all levers in the top and bottom line.

The private equity market booming

Private equity investors currently have a healthy cushion of dry powder. Central bank interest rates will be remaining at a very low level in the longer term provides optimal conditions for investment. However, the high capital is also countered by increased sales prices. As a consequence, private equity companies must increase the value creation of their portfolio companies in order to achieve the most profitable exits possible.

In order to stabilise margins and defy the pandemic, private equity companies have recently pulled out all the stops in the top and bottom lines. A closer look, however, reveals that not all potential for operational value enhancement has been exhausted. Procurement in particular still has a lot to offer in terms of cost optimisation.

Increase the value of your portfolio companies!

We support the value enhancement of your portfolio companies with many years of expertise and powerful procurement optimisation programmes. We accompany you throughout the entire process – from short-term measures during due diligence, to operational measures to increase value during the holding phase, to preparing the exit.

Portfolio companies that have been in private equity ownership for a long time usually already have a very professional procurement organisation and have already implemented the entire set of standard measures. We go one step further and use sophisticated methods and levers to find further potential in your portfolio companies. In addition, we support you in the digitalisation of processes and the implementation of compliance and sustainability strategies.

How do we operate in private equity consulting?

Operative Due Diligence

Within the framework of operational due diligence, we create transparency and evaluate synergies as well as potential savings that could be realised in the event of a takeover of the investment target. Thanks to our many years of experience and benchmarks from a wide range of industries, we can present you with a meaningful and realistic assessment of potential within a very short time. From this, we derive a detailed implementation plan for you, including a ramp-up forecast for the run rate and EBIT impact of the savings.

Optimization of portfolio companies

Cost optimisation:

After a detailed analysis of your direct and indirect requirements, we develop an action plan by identifying the optimal levers for each product group. As a rule, we start with categories in which we can realise so-called quick wins – rapid savings results that become immediately visible in the P&L. Using methods such as demand management and cost structure analyses, we put specifications to the test and uncover inefficiencies that lead to further savings.

Procurement transformation:

As part of the optimisation process, we also put the procurement organisation of your portfolio companies to the test. We support you in formulating procurement strategies, optimise procurement processes and further develop the organisation. This also includes the accompanying implementation of change management measures and training programmes.

Digitisation of procurement:

We help with digitalisation projects with our expertise in various industries – from the implementation of e-sourcing tools and the digitalisation of procurement processes to powerful data analyses and dashboards.

Working capital optimisation:

In order to secure the solvency of your portfolio companies and avoid unnecessary surpluses, we optimise payment flows and inventories and thus ensure an optimised working capital.

Cross-Portfolio-Optimization

We help you identify and use synergies between several portfolio companies. Projects to standardise and bundle requirements usually offer great savings potential here. However, they also entail a high degree of complexity. Taking into account the interests of all companies and investors involved, our PE-experienced experts create transparency in the often heterogeneous systems and organisational structures and define the most effective levers.

Carve-Out or PMI

Carve-Out:

In the context of carve-out deals, we support you in a smooth transition or in setting up a new, efficient procurement department. In doing so, we analyse existing structures and contracts and hold talks with existing suppliers in order to ensure and legally secure the supply directly after the carve-out.

Post Merger Integration (PMI)

The merger of two portfolio companies as well as add-on integration offer enormous optimisation potential in procurement. We support you before the closing by carrying out confidential analyses at both companies and drawing up a tailor-made implementation plan, naturally without violating applicable competition law. Post-closing, we support you in the implementation of the action plan, realise P&L-effective savings and help to establish a central and sustainable procurement organisation.

Supplier Due Dilligence

We set up a high-performance supplier management system for you. We use this to secure sustainable savings and support you in recognising and managing price and supply risks in good time. We also check your supply chain for compliance risks and help to ensure sustainability standards among suppliers.

Whether stationary retail, multi-channel, pure online retail or marketplace: for retail companies, a strong and personalized focus on customers, differentiation from direct competitors and the special shopping experience are crucial to remain competitive.

Optimisation in procurement & supply chain management increases profitability in retail

Efficient processes, clearly structured assortment planning, flexibility in category management and sourcing prices in line with the market are of particular importance in order to keep pace with the changing needs of customers. Find out how we, as experts with many years of experience in management consultancy in retail, can support you in this.

Our 20 years of retail consulting experience with over 70 international clients ranges from food and non-food for brands and private labels to needs in indirect procurement (“Goods not for Resale”).

Different products, similar challenges!

Our extensive expertise in procurement consultancy and supply chain management enables us to quickly identify potential in the supply chain and improve processes. Your results are significantly increased as a result – and that is how we measure ourselves. As different as the products on offer and the role they play in consumers’ everyday lives are – many retail companies face similar challenges in procurement and supply chain management. This is something we observe again and again as experts in retail consulting.

Where we can help you

Category Management

Convincing Assortment Design

Strategically structured assortments are crucial in retail to differentiate yourself from the competition and to retain customers. With our proven optimisation approaches in category management, we support you in convincing customers and increasing the value of the average receipt with a holistic design of your range.

Making brand negotiations successful

The basis of successful brand negotiations is professional preparation. This includes in-depth supplier analysis and calculation of potentials as well as the selection of negotiation strategies and levers and the setting of a maximum and minimum target. We provide your procurement staff with a tried and tested toolset and support them with training so that they are optimally prepared for annual negotiations in the future and can improve the results in the long term.

Private labels: Ensuring profitability

Own brands are a challenging field for procurement. On the one hand, they have to be cheaper than branded products, but on the other hand they have to meet quality expectations in order to convince customers. For the retailer, private labels must increase the company’s average selling margin. For these reasons, private label sourcing is an elementary part of today’s procurement function.

To meet all requirements, we support your procurement: 

• In the standardisation and specification
• In the preparation and realisation of (online) auctions
• In the qualification and further development of suppliers
• In process optimisation

Knowledge transfer is possible both through targeted further training in procurement and through on-the-job training by working together with our experts.

Sourcing in Asia

Networked worldwide with the right partners 

The right choice of suppliers and sourcing channels can lead to a significant competitive advantage. However, inconsistent standards, political and legal differences and communication barriers can make it difficult to tap into global sourcing markets, especially when sourcing activities in Asia are managed from Europe.

With our location in Shanghai, we support you in opening up Asian procurement markets, identifying suitable suppliers and establishing stable supply chains. The aim is to reduce your procurement costs while maintaining product quality.

The trend towards sustainability in fashion

Sustainability is gaining importance in the textile industry and sales of ecologically and fairly produced fashion are increasing. In addition, the planned Supply Chain Act obliges companies to comply with environmental and human rights standards in the future.

To prove the origin of textiles from environmentally and socially responsible production, there are a variety of different textile labels.

This presents procurement with the challenge of keeping track of certification marks, audited suppliers and processes. We support you in creating transparency about the textile seals and their meaning and in identifying suitable textile seals for your procurement. In doing so, we take into account quality requirements and costs in addition to the fulfilment of sustainability aspects.

Innovation is written into the DNA of technology and telecommunications providers. Increasingly, they must now learn to integrate sustainability into their agility and speed-driven business models – both in terms of hardware and software as well as services.

Innovation procurement for telecommunications and technology

Procurement for something that doesn’t yet exist – that is, in a nutshell, the challenge in the technology and telecommunications sectors. Data volumes, the number of users and energy requirements have been rising for years as more and more areas of business and society become digitally organized. Both the end devices and the infrastructure behind them must become ever more powerful in order to provide the required capacities for the ever deeper networking at all times and to be able to process the data volume.

For providers, this offers opportunities for growth and development. After all, modern technology-driven business models are based on unlimited network availability and performance. At the same time, industries must curb their hunger for energy so that they can make their contribution to a climate-friendly economy.

To find intelligent solutions, procurement must be stringently focused on innovation. Our experts work with you to develop concepts that reconcile creativity, performance and sustainability.

Reconciling innovation and sustainability

Reduce, reuse, recycle - this triad will also apply to physical technology products in the future. However, if the industry continues to consume the same amount of raw materials as it does today, it will neither be possible to achieve sustainability goals nor to take advantage of the many opportunities offered by digitization - because the materials available are simply not sufficient for all needs, as the chip crisis is currently demonstrating. In the case of digital applications, energy consumption must be reduced. Servers and data centers already account for around ten percent of global energy consumption. Energy-optimized software and intelligent control of data streams can and must reduce demand. Energy efficiency and circularity (cradle-to-cradle) start with product design. The earlier procurement is involved in planning, the more carefully category managers can sound out their markets and contribute their expertise.

Guaranteeing constant availability and capacity

Digital solutions are helpless if the infrastructure is not efficient. In Germany in particular, considerable investment will be needed in the coming years to meet the steadily rising demand for transfer performance. Technology providers are hosting more and more computing power because software is no longer delivered on physical data carriers. Applications such as blockchain, which are mirrored on different servers, place even greater demands on the performance of clouds and networks. As in energy generation, it is not only necessary to permanently cover a base load, but also to intelligently manage demand peaks. This requires efficient, data-driven forecasting and professional risk management. Failure risks must be minimized in any case, and at the same time costs - and energy requirements - should be balanced. Otherwise, infrastructure and technology providers will not be able to optimally manage growth in the coming years and exploit development opportunities.

Decoupling data volume and energy demand

Up to now, the increasing volume of data has also led to higher energy requirements. In order to achieve the politically prescribed climate targets, the two flows must be decoupled from each other. This is where procurement can provide the decisive impetus to find cost-optimized and at the same time innovative solutions.

Business consulting: procurement for media and advertising

Few industries business models have been as profoundly impacted by digitization as media companies and advertising agencies. The boundaries between print, radio, film and TV, and events have long been eroded, as have those between online and offline. The same applies to the business segments: publishers operate online marketplaces, streaming services shoot movies and internet retailers publish magazines and organize events. To provide the necessary funds for these further developments, the respective core business must generate profit. Procurement is required to procure at optimal cost for the “old” business. At the same time, it must be capable of sounding out the markets for innovations and finding suitable suppliers.

Our experts for the media industry support you both in cost optimization and in realigning your procurement to innovative business models.

Adapting structures and processes to the current business model

While traditional media companies have been undergoing a consolidation process for years and are gradually shifting their offerings from the analog to the digital world, the younger Internet groups, online portals and networks are expanding their activities further and further. The pandemic lockdowns have also led to a massive increase in demand for online services and entertainment. For both older users and newcomers, the rapid development of recent years has created structures that are not always optimally aligned with each other. This is where our consulting expertise comes in, by first analyzing and then optimizing the structures and processes that have evolved.

Leveraging procurement expertise at all levels

It is advisable to create structures for all requirements and product groups that combine the advantages of centralized control with individual flexibility. Our experts can provide support here by analyzing and categorizing all goods and services. Particularly in the case of requirements and services with a high level of complexity and criticality, it should be ensured that those responsible for the budget work closely with procurement in order to make the best possible use of professional expertise. Processes should be created here to ensure the involvement of the respective category managers at an early stage of procurement. The aim is to develop a culture of strategic cooperation that creates real added value for advertising and media companies.

The requirements for manufacturers and distributors in the medtech sector have once again become significantly more complex due to the introduction of the “Medical Device Regulation”. At the same time, there is concern that important existing and niche products will disappear from the market due to the increased effort.

Procurement consultancy in medical technology

As a manufacturer or distributor of medical technology, the Corona virus pandemic has had a massive impact on your business. With rising vaccination rates, the situation is beginning to normalise, but it will be a long time before the old predictability returns. In addition, the EU’s new Medical Devices Regulation, which has been in force since May, imposes new requirements that involve more time and higher costs for the certification of medtech products. To ensure that you can continue to operate profitably in the face of these challenges, new approaches to cost optimization and supply chain management are necessary.

We will develop an individual programme for you, which we will implement together with your employees if desired.

Making procurement and SCM fit for the new normality

Cost optimization

Due to the global shift in demand, cost structures for raw materials and intermediate products have changed substantially, especially in the medtech sector. It is not yet foreseeable whether the shifts will be permanent. It is indispensable to analyse the previous requirements with regard to savings potentials, to bundle them anew, to specify them and to put them out to tender.

Risk- and supplier management

Although the great wave of insolvencies has so far failed to materialise thanks to broad-based government support programmes, the consolidation of the entire medical technology industry, which had already begun before the pandemic, continues to progress. It is likely to accelerate in view of the new MDR. Companies should therefore analyse their supply chain and check whether current suppliers and their product portfolio are still the right fit.

Furthermore, due to the ongoing disruptions in global markets, it makes sense to diversify one’s supply chain and selectively qualify new suppliers, if necessary in regional proximity to one’s own production. The establishment of a structured risk management system safeguards your company against the occurrence of future risks.

Working Capital Management

Professional working capital management optimally controls liquidity and is thus the best basis for defying disruptions of all kinds. Working capital should therefore always be considered in the course of optimising procurement and supply chain management.

Digitalisation & Training

Digital tools provide the necessary transparency in the supply chain and can automate routine activities in procurement. Both are important prerequisites for complying with the new Medical Devices Regulation.

With customised training courses in procurement, we can support you in sustainably anchoring the newly acquired knowledge in your company.

Frequent supply bottlenecks and temporarily limited availability of active ingredients and drugs are prompting the pharmaceutical industry to rethink its approach. Relocating production facilities for relevant active ingredients back to Europe can be a solution here.

Procurement optimisation in the pharmaceutical industry

For years, extending the supply chain for active pharmaceutical ingredients to Asia was seen as a panacea against ever-increasing cost pressure. Since the beginning of the Corona virus pandemic, a rethink has set in: There is now a consensus that the active ingredients for medicines needed en masse should not be produced exclusively in India or China.

The temporarily limited availability of central active ingredients such as painkillers or antibiotics shows very clearly the risk that arises when precursors are only sourced from one region or even from a single supplier. Since medicines are not consumer goods but part of the provision of public services, permanent production and delivery capability must be ensured.

This does not mean that the entire supply chain must now be located in Europe, which would not even be possible given current capacities. But the move away from single sourcing is a necessary measure in view of supply risks. Selecting European suppliers strengthens the resilience of the entire system.

In order to diversify or re-regionalise supply chains, strategic procurement is indispensable. Our experts analyse your company’s existing supply chain and support you in establishing and qualifying local suppliers.

Define and implement sustainability goals

The topic of localisation strategy in particular is not only about the availability of active pharmaceutical ingredients, but also about higher sustainability standards than are possible with the current global structures in the pharmaceutical industry. Modern production facilities and shorter transport routes, for example, are a starting point for the necessary decarbonisation. Further, sustainable solutions, for example in packaging, can be a measure to conserve resources. Our experts can advise you on the development and implementation of sustainability goals in procurement.

Cost reduction in Indirect Spend

In the procurement of pharmaceutical companies, the daily routine is often dominated by the production or contract manufacturing of finished products. Expenditure for requirements that do not flow directly into the value creation process is often neglected. Experience has shown that there is great potential for savings in the areas of marketing, logistics, facility management and IT. We support you in reducing your procurement costs in the so-called indirect requirements and act as an interface for cooperation between procurement and the specialist department.

Environmental pollution, population growth, and chronic diseases are putting increasing cost pressure on healthcare systems. With these challenges, the importance of clearly defined processes and digital solutions in the healthcare sector has also grown steadily in recent years.

Medical services in procurement

Whether hospital, rehabilitation clinic, care institution or outpatient service provider, or in public or private ownership: limiting material costs is the central task for procurement. At the same time, it is necessary that category managers in the healthcare sector always keep an eye on innovations in order to ensure the best possible care for patients.

Thanks to our many years of healthcare consulting, we can support you in making the processes in procurement and supply chain management more efficient and in tapping the potential for long-term cost reduction.

Our procurement approach

Reduction of material costs

In order to reduce material costs in hospitals and at outpatient providers, the classic procurement levers such as bundling and negotiating are often not sufficient. Standardisation and respecification of requirements are the more promising measures for healthcare providers. Procurement departments often do not have the necessary resources for these tasks in addition to their day-to-day business – which our experts bring with them and support your team in research, tendering, auctions, negotiations and onboarding of new suppliers..

Building efficient processes in supply chain and warehousing

The supply chain of a hospital or other healthcare company is very complex and the demand categories are broad. That’s why we look at the entire supply chain when optimising processes in hospitals. In addition, we use existing data to optimise your hospital’s stock levels and stabilise the supply of goods. In this way, all materials are available in appropriate volumes and write-offs due to reaching the expiry date are avoided.

Digitalisation in the healthcare sector

In the healthcare sector, digitisation is progressing only slowly – high investment costs combined with data protection risks are slowing down the willingness to innovate. The digitalisation of hospital procurement, however, can release great potential because it relieves buyers of routine tasks and offers scope for innovation and supplier management. You can find out here which steps are possible and sensible.

Further education and training for hospital procurement

Through the close cooperation of our consultants with your procurement, the knowledge is anchored in your institution. In addition, our ITC training centre will train and coach your procurement department in individual further training courses on request.

Energy and natural gas are part of every supply chain. Due to high levels of energy security in the past, companies recently optimized their energy supply primarily from a sustainability perspective. However, in light of the Russian invasion, risk management has become a critical issue along various stages of the supply chain. Risk exposure, procurement and investment strategies as well as possible energy availability scenarios for companies need to be re-evaluated.

Effective measures and solutions for sustainable energy and supply security require a cross-functional approach. An understanding of energy markets, supply risk management best practices, sustainability goals, and specific procurement knowledge of contracts and requirements must be brought together into a team and optimized.

INVERTO, through its Energy Practice Area and Centers of Excellence for Risk Management, Sustainability, and Indirect Spend, offers the combined expertise and experience to develop customized solutions.

Energy management in your business

The starting point for professional energy management is – as in every category – transparency about current and future demand. Depending on the complexity of the initial situation, information and demand profiles from energy suppliers or the use of intelligent meters at decentralized consumption points provide the necessary transparency. The selection of the appropriate levers depends on the company-specific infrastructure, the required energy mix and the regulatory framework conditions, which vary greatly in the current situation.

Which levers are the right ones depends on the specific company needs and individual requirements such as the priority given to ESG criteria or security of supply.

Energy procurement and contract management

Although energy is a highly standardized and national category, savings are also possible through classic measures such as contract management, competition and bundling. In the current context, use every opportunity to help ease the situation!

Strategy and Risk Management

The energy market is currently very volatile and reacts to macroeconomic events and political circumstances. Unfortunately, at the moment it is not foreseeable when this situation will change. Even if the Russian invasion were to end tomorrow – the move away from Russian gas will not. This means that a well-thought-out energy procurement strategy has never been more important.

However, companies should use the energy crisis as an opportunity to rethink and reduce their consumption. Many companies have committed to decarbonize. Perhaps the crisis can accelerate the transformation to a Net Zero future.

Energy Management

It has always made sense and been more cost-effective to reduce energy consumption. Moreover, the use of renewable energy sources offers advantages in the current situation, so companies should tackle two strategic steps:

Country-specific regulations mean that energy costs vary greatly from country to country. In many countries, government levies account for around 50% of costs or even more. In addition, we expect government levies and CO2 pricing to rise further in the coming years to increase pressure to save energy.

Measures for enterprise-wide energy management include:

• Switching off the lights, limiting the heating in winter and the air conditioning in summer
• Training users and labeling equipment with energy-saving information so that this becomes a daily routine.
• Voltage reduction, i.e., use of a device that equalizes the voltage of all electrical equipment to optimize the supply
• Integration of smart devices and automation, e.g. automatic shutdown of heating or air conditioning when no one is in the office

While some of the measures require investment, some can be taken as part of daily operations to reduce energy consumption.

Managing energy risks along the supply chain

Companies generally do not know the energy requirements and energy mix of their suppliers. However, transparency is currently of crucial importance.

Compile this information to identify potential risks for production losses or threats to financial stability, because these risks can endanger your own production in the medium term. It is possible that particularly energy-intensive productions may no longer be able to cover their costs. Interestingly, questions about energy security are very much linked to the key aspects of a sustainability strategy, which must create transparency about CO2 emissions along the supply chain.

As a short- and medium-term solution, companies should diversify their sources of supply for critical components. Overseas suppliers may be less vulnerable to energy or gas supply risks than European ones. Include Tier 2 suppliers in planning as much as possible.

In the medium and long term, technical changes are reasonable:

• Which products and components can be adapted to reduce the energy intensity of your production?
• Can materials (metal, plastic, etc.) be reduced or replaced to minimize the impact of energy-intensive production processes?

This approach not only reduces energy consumption and brings cost benefits, but also has a direct impact on transparency and subsequent reduction of Scope 3 CO2 emissions.

Prepare contingency plans

Companies and their key supply chain partners need to be able to take the right action quickly in the event of an energy shortage. Even cost-intensive measures can be useful and necessary to maintain production.

• The supplier markets must be closely monitored from a political and economic perspective, as the current situation can change from day to day.
• It is crucial to establish close coordination between all relevant partners in the supply chain
• Prepare countermeasures for those suppliers or components that are most at risk in the event of an energy or gas supply interruption or where supply uncertainty is greatest. A simple solution, for example, is to build up or increase safety stockpiles.
• Simultaneously, companies should check which key suppliers are exposed to the risk of insolvency and provide support where necessary, for example by focusing on selected product lines or providing input materials.

Beyond procurement, the entire organization (R&D, finance, sales, etc.) must be mobilized. Companies should continue the dialog on energy and gas with their suppliers beyond the current crisis in order to drive forward the switch to renewable energy sources.

Companies are responsible for the environmental and socio-political impacts of their activities. Procurement, with its interface function, is able to realize corporate goals into solutions. This is best achieved through a comprehensive, value-creating transformation of procurement.

Transformation of procurement – with strategy into the future

The major crisis of our time, Corona and the climate, have made it clear that “business as usual” is not a viable option in the long term. Many companies are therefore questioning their purpose and their business model, setting their own ESG goals and thus facing up to their social responsibility. This development gives procurement a new role that goes hand in hand with new requirements. Procurement of the future works digitally, it cooperates closely with partners in the supply chain to drive innovation and achieve sustainability goals, and it makes a strong independent contribution to value creation.

Our experts will be happy to advise you on how to best position your procurement for the future and leverage untapped potential.

Purpose and goals of the procurement department

Employees are more successful when they better understand the goals and purpose of their work. Companies that want to develop should take this into account. When the purpose and goals of the company as a whole change, this change must also be broken down and integrated into individual departments.

As CPO, you should be as specific as possible about the need for change in order to transform traditional procurement into a future-proof and powerful procurement. It also makes sense to include the new goals in the incentives for employees. This not only increases individual motivation, but also demonstrates the importance of the new goals.

How we can support you

Adding value through innovation and sustainability

The traditional core areas of procurement are efficient procurement processes, commodity group management, and supplier management. These tasks will remain, but will be eclipsed in the future by other aspects including: the further development of strategy and competencies and the management of innovation, sustainability and social responsibility. The modern procurement is increasingly taking on interdepartmental tasks that require close cooperation with the specialist stakeholders. In the future, suppliers will be more intensively involved in innovation development. In this scenario, procurement must participate in the planning process at an early stage to approve potential suppliers and to be able to react to changes at an early stage. The topic of sustainability has also significantly increased the willingness to examine and restructure one's own supply chain if required: As an increasing number of countries adopt laws for due diligence in the supply chain, it is necessary to reduce ESG risks that can arise; for example, through dependence on individual suppliers or regions of origin. In addition, many companies are setting their own targets. Procurement will increasingly be faced with the task of analysing new markets and approaching new suppliers.  

Digitalization

The Corona pandemic acted as an accelerator for the digitalisation of procurement: many companies found during the crisis that a lack of transparency in the supply chain made it difficult or even impossible, to maintain their own supply. The use of digital risk information systems and the networking of information sources have therefore increased significantly. In order to be able to fulfil their role as innovation and sustainability partners in the future, procurement managers need to be relieved of routine tasks. Digital assistants can, for example, take over the ordering of standard requirements. The benefit of using digital tools must be clear, otherwise employees will perceive the new tools not as support but as a burden.

Successful employees - training competences

Goals and strategies are important for the development of a company. However, transformation begins in the minds of those who are supposed to realise it. It is important to precisely define the differences between current and future requirements, to involve the employees in this process and to show them the opportunities for further development. Our training centre supports your team with individually tailored training courses so that they can make the most of these opportunities and ensure the transformation is successful.

Cost optimisation is the central task of procurement. What constitutes an optimal price is influenced by many variables: in addition to the actual product costs, quantity, availability, quality, sustainability and working capital commitment flow into a cost analysis.

Exploiting potential through cost optimization

Procurement has become more complex in recent years. The familiar matrix of price, quality and availability has been expanded to include the dimensions of sustainability and capital commitment.

Today, digital solutions already provide support in many areas, but they require an intelligent strategy and control to generate real benefits.

Procurement managers need clear goals derived from the overall strategy in order to meet the diverse requirements in the best possible way.

With more than 20 years of experience in supply chain and procurement consulting our experts will be able to help you to identify potentials for cost reduction and offer you full support in implementing measures to reduce your procurement costs.

As part of our potential analysis, we segment and analyse the costs for all procurement goods, purchased products and services by commodity group. We consider both direct and indirect requirements and take into account the current procurement and market situation.

With our benchmarking approach, we have the appropriate strategy to deliver best-in-class solutions in your industry for your entire procurement organisation or for selected resources. In doing so, we do not work with across-the-board cuts, but examine within the framework of demand management what your expenditure structures are like and where there is a need for optimization. As a result, you receive concrete information from us on which cost savings can be realised.

Effective procurement creates value for every company

After the analysis phase, we work hand in hand with your procurement staff to analyse the identified potential. To do this, for example, we sound out the procurement markets again and enter into negotiations with your suppliers or qualify new suppliers if necessary. Especially in today’s world, where remote working from the home office has become indispensable, online auctions are a valuable means of acquiring new suppliers and creating new competition among established suppliers. We would be happy to develop suitable concepts with your employees and implement online auctions.

Cost reductions can be achieved relatively quickly in many areas – within a few months. They increase the profitability of your company and have a direct positive impact on the margin. In addition, the freed-up funds are available for investments and thus pave the way for innovations and higher value creation. The goal of our projects is always to build your team into real partners in value creation. To this end, we also offer individually tailored further training in procurement.

Today, the question is no longer whether a company digitises processes, but how. Digitisation makes companies more efficient and helps them to achieve the goals they have set themselves.

Successful digitization in procurement

Today, the question is no longer whether a company digitizes processes, but how. Digitization makes companies more efficient and helps them to effectively achieve the goals they have set themselves. Digitization is always an individual development process, adapted to the respective needs and capabilities of the company.

To achieve optimum results, the digitization strategy is derived from the general corporate strategy and then scaled down to the particular functions.

Companies have to decide individually which steps will be placed on the digital agenda and in what order they will be tackled.

The first step is to clarify what services a department contributes to the company’s overall result and what resources it needs to fulfill its tasks as effectively as possible. In this way, the first steps of the digital transformation can be taken successfully.

Our success factors in digital procurement

• Typical Digital Transformation Challenges
• Digital piloting in procurement
• Consider the individual degree of maturity
• High degree of IT complexity and tool landscape
• Lack of transparency of ongoing projects
• Uncertainty about the highest impact priorities
• Skepticism within the organization vs. digitalization and change

We help our clients to systematically assess the current maturity and identify the high priority areas and opportunities with the highest ROI. We support in embedding solutions into business priorities and prioritize and align the execution roadmap.

Heat waves, floods, hurricanes: the increasing weather extremes clearly show that the economy must become environmentally friendly and CO2 neutral. Furthermore, sustainability has an ethical component: Human rights should apply to everyone and along the entire supply chain.

The importance of sustainability

Sustainability is the order of the day. To protect our earth and climate we need to live and produce in a climate-neutral way in the future. Political authorities have already defined clear goals. Legal requirements contribute to climate neutrality, but in most cases go far beyond this.

In many countries, companies are already obliged to take environmental and social standards into account and to monitor compliance with them along their own supply chain. The European Union’s Corporate Sustainability Due Diligence Directive is due to come into force in 2024 and Canada is looking to follow.

Procurement, with its interface function to the supply chain, plays a central role in making the company sustainable and reducing its carbon footprint. The sustainability focus becomes a real value driver by boosting the organization’s performance and improving the quality of its products. Furthermore, sustainable procurement can enhance a company’s innovation while at the same time reduce risks. For sustainable procurement transformation to succeed, you should rethink the topic: making more sustainable products at less cost and not focusing solely on the risks. Look for ways to make your products better and your processes more efficient.

Sustainability in procurement: This is how INVERTO supports

As leading experts in supply chain management and procurement, we at INVERTO offer to help your organization from a 360-degree sustainability perspective. Overall, our solutions can be summarized into anchoring of sustainability in procurement and execution of ESG measures, which includes decarbonizing the supply chain, sustainable sourcing and ensuring responsible operations.

The Social and Governance aspect in Procurement

We utilize our up-to-date knowledge about the market to support our clients with governance structure, by ensuring compliance with local and international laws and legislations. Further, we help with implementing a social procurement strategy.

• Supplier Code of Conduct: Defining and implementing responsible procurement as well as implementing a Supplier Code of Conduct – a set of standards that suppliers should comply to 
• Supplier risk assessment: Conducting end-to-end supplier risk assessment to evaluate the supplier portfolio 
• Supply Chain Act: Assessing risks to human rights and child labor by jointly implementing measurable actions

Anchor sustainability in procurement

We developed a structured two step model where we firstly assess the maturity level and establish the baseline in which future ESG targets and ambitions are derived based on the findings. The second step is to prioritize the targets into initiatives and transform to a future proof business model, enabling the entire organization to execute on the ESG targets. With the help of our Sustainable Procurement E-map Index, we analyze your procurement. Benchmarking shows where your company stands compared to typical companies in your industry. The E-map assesses your procurement department in six dimensions from Governance & Strategy to Supply & Risk management. We support clients across all industries to become more sustainable while procuring materials and products. We support the client throughout the entire journey of selecting right sustainable materials and producing products in a sustainable way.

From port closures, to Corona, to the crisis in the semiconductor market: Structured risk management cannot prevent crises, but it can provide well thought-out solutions. Through transparency in the supply chain and ready-made emergency plans, companies remain capable of acting.

Flexible supply chain and long-term security of supply

Risk management has long been a very abstract concept. But recent examples in the context of the Corona virus pandemic have shown how quickly global and widely ramified supply chains can get out of kilter. New requirements, such as those imposed by the Supply Chain Act, further increase uncertainty.

Good risk management helps to identify risks at an early stage and to counteract them with alternative plans. At the same time, it is hardly possible to avoid risks completely because they are part and parcel of entrepreneurial activity.

It means proactively identifying risks and reacting quickly. To do this, companies need an early warning system that includes all levels of their own supply chain. We support you in professionalising the risk management process in your company and implementing effective measures.

Risk Management Process

Risk Identification

Identification of all potential events that might not run as planned and have a significant impact on pricing, supply reliability or quality.

 Risk Assessment

Assessment of the probability of events occurring and evaluation of their potential impact on the company’s performance. Tests run for emergency situations.

 Risk Monitoring

Monitoring all risks and taking appropriate action against any impending deviation from targeted objectives. Setting up a risk control tower in order to be able to act quickly.

 Risk Management

Implementation of strategies to make risks manageable: Risk prevention, risk taking, risk spreading, risk transfer.

Our service modules for optimising risk management in procurement

In many companies, the potential of active and strategic risk management has not yet been sufficiently implemented. We help you identify and implement professional risk management.

After a performance check, we develop the necessary processes and procedures together with those responsible from your company. This includes long-term preventive measures and the implementation of a modern reporting system for proactive risk management. In addition, we can also support you in taking short-term measures to minimise risks.

How do we proceed in risk management?

Performance Check:

We analyse the current contribution of your procurement function to minimising risks. Based on the results, we derive concrete measures to increase performance in order to position your procurement as a strong partner within your overall organisation. The risk management performance check also forms the basis for the strategic development and implementation of effective optimisation programmes in risk management.

Supplier-Health-Check:

We identify weak points in your supply chain by creating transparency about your inventory suppliers and providing you with tools to identify insolvency risks of your suppliers at an early stage. In doing so, we do not rely exclusively on self-reporting but include various data sources in the analysis. Based on the data collected, we estimate the insolvency risk for each individual supplier and classify them into risk levels.

Supplier Risk Management:

Based on the Supplier Health Check, we design and implement an individually tailored Supplier Risk Management System for you so that you can minimise default risks in the future. The system ensures regular supplier assessments and has early detection mechanisms. In addition, we define concrete action plans for each risk level.

Product Group Management:

We analyse which commodity groups in your company are particularly susceptible to risk and in which areas failures should be avoided at all costs. Based on this, we then prioritise and create procurement strategies for the individual commodity groups with which you can keep supply risks to a minimum. Together with you, we then identify the relevant procurement markets and suppliers and conduct tenders and negotiations. As a result, you have a restructured supplier base and sustainably optimised procurement.

Implementing working capital optimization measures has proven to be a challenge for organizations across all industries. Improvements tend to reverse back to status quo when the organizational focus shifts. Processes and responsibilities have to be defined precisely to maintain the level achieved.

Safeguarding liquidity through working capital optimization

Working capital management is an interdepartmental activity. Mainly managed by the finance department but procurement, supply chain management, production and sales also have a major influence on the variables – but often without being aware of their role.

The basis of efficient liquidity management is therefore to build up knowledge of the interrelationships among all parties involved and to create clear responsibilities. Bringing our comprehensive hands-on project experience, we will support you to improve your working capital in a sustainable way, with a total cost of ownership (TCO) approach.

The benefits of professional Working Capital Management

• Improved cash flow allows strategic flexibility that can yield in a competitive advantage in today’s rapidly changing markets
• Leaner balance sheet leading to improved KPIs and valuation metrics – less cash needed to fund the company allows a higher valuation
• Improved bottom-line through less bad debt, less obsolete inventory and decreasing financing costs

Professional training from buyers for buyers

Changing framework conditions in procurement mean that buyers are faced with demanding challenges. Advancing globalisation, increasing volatility of the procurement markets and more complex framework conditions for pricing are just a few examples of changed external influencing factors. Within companies, too, the demands on a well-positioned procurement department are increasing.

In particular, the development of procurement from an administrative unit to a core function in the supply chain is in the foreground.

Efficient procurement can contribute significantly to increasing the value of your company. From an economic point of view and taking into account the shortage of skilled workers, it is also more effective to focus on targeted employee development.

Up-to-date and themed expert knowledge in procurement

We adapt our tried and tested training modules to the individual needs of our customers and put together a tailor-made curriculum. For this, we apply our cross-industry expertise to develop training concepts and content tailored to your company’s specific environment.

Our trainers are experienced procurement managers who manage cost reduction projects in procurement for our clients, in addition to their engagement as trainers and coaches. By this we are able to incorporate the latest procurement trends and expertise into our training sessions. As all our trainers have extensive industry and procurement expertise, our clients will be trained by experts who are well acquainted with the respective markets.

Our trainers act as:

Partner: As experts in procurement and supply chain management, we seek dialogue at eye level with your procurement and supply chain professionals to support their individual development.

Pacemaker: Your team benefits from the agility and efficiency of a specialized management consultancy.

Practitioner: Your employees receive up-to-date knowledge from our daily project business to improve your procurement function.